​San Francisco is suing President Donald Trump over an executive order to withhold funds from "sanctuary cities" that don't comply with immigration-related requests from the federal government. Though the order isn't directly related to the workplace, employers in sanctuary cities may be prime targets for Immigration and Customs Enforcement (ICE) raids and audits.

Trump's Jan. 25 orders covered a broad range of immigration-related priorities that include building a wall between the U.S. and Mexico and penalizing sanctuary cities.

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"The executive order is a little muddled," said Alden Parker, an attorney with Fisher Phillips in San Francisco and Sacramento, Calif., regarding the sanctuary city order. "In very general terms, it says that cities, counties and states shall comply with federal law, and one of the potential outcomes if they don't is that they'll be denied federal funding."

What the order and lawsuit probably foretell, he added, is that we are going to see quite a bit of focus on immigration issues and enforcement in the coming years, and employers are going to have to watch out for that.

Businesses in sanctuary cities may be the first subjected to ICE raids or I-9 audits, he said. Therefore, employers in those cities should make sure their paperwork and processes are in order.

"Employers will want to ensure they have developed and implemented robust I-9 compliance policies and brace for the very real possibility that any potentially undocumented employees will be taken from them," said Christopher Thomas, an attorney with Ogletree Deakins in Denver.

In broad terms, San Francisco's ordinance directs city officials not to use their time and resources to assist ICE in enforcing federal immigration laws unless the city is required to do so by federal or state law, Parker said. He added that it is difficult to define what makes for a sanctuary city because each city has different policies that it has put into place.

Thomas explained that in general, sanctuary cities have "opted to limit their efforts with respect to immigration enforcement, including limiting police investigations into the legal status of community members and declining to hold those they arrest beyond a scheduled release date despite a federal agency's issuance of immigration detainers."

Alleged Federal Overstep

Trump's order claims that "sanctuary jurisdictions across the United States willfully violate federal law in an attempt to shield aliens from removal from the United States."

San Francisco argues, however, that the order is unconstitutional because it intrudes on the city's sovereignty. "This lawsuit is about state sovereignty and a local government's autonomy to devote resources to local priorities and to control the exercise of its own police powers, rather than being forced to carry out the agenda of the federal government," the complaint said.

Parker said the federal government isn't required to give funding to cities or states.

There are some instances where Congress has given the president the authority to withhold funds under certain laws.

San Francisco receives about $1 billion in annual federal funding, he noted. "There will be a fight about whether some of these funds are mandatory or discretionary."

Employer Takeaways

Employers in so-called sanctuary cities that rely upon federal funding—either directly or indirectly—could run into significant revenue shortfalls if that funding is limited, Thomas said.

"In addition, if communities conclude they cannot risk such losses in federal funds, employers could face the possibility of undocumented employees being subject to arrest and removal from the United States—sometimes over something as simple as being pulled over for a burned-out brake light," he added.

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